I did not know when I was a young man that my field of study,
economics, would some day become the basis of a religion, one powerful
enough to threaten the very existence of human beings.
Neoclassical economics was rightly proud of one of the more brilliant
proofs in the history of the world. The proof began with clear and
focused inspiration by Adam Smith, carried on through the 19th century,
especially with Ricardo, the Austrian marginalists, and Walras; was
modified critically by Pareto; and was parsed and formalized by the
modern general equilibrium theorists and greats such as Arrow and
Debreu.
That proof said something extraordinary. It said that if
certain exacting conditions could be fully met, a free market system is
provably the best economic system imaginable, best meeting the needs of
individuals in a society that embraces it.
This is not merely an
ideological assertion. Not rhetorical. Not a point of view. This is
the product of a massive compilation of mathematical and logical
argument. It is not to be dismissed merely as a matter of politics -- at least,
not by the rational.
Many took this quite seriously, as they
should. Many argued very forcefully that capitalism must be assertively
advanced at the expense of other, lesser, systems. The belief in
markets, the belief in capitalism, took on a religious fervor. In its
extreme form, it took on the form of faith-based dogma, a body of belief
best described as market fundamentalism.
Good economists
understood that the proof, nifty and clever as it was, is subject to
those "exacting conditions." Good economists understood that the proof
says IF those conditions are met perfectly THEN the case is made.
Unfortunately, two things are undoubtedly true, and all good economists know both.
One, those conditions are never met, and have never been met. That is,
the proof in favor of capitalism is a proof in favor of one economic
system over another in a fictitious world of theory only. A world that does not and has never existed.
Two,
and it took another profound proof to understand this, economists
discovered the second best theorem that says, in short, that if you
do not meet all those exacting conditions perfectly (say you meet them
all approximately) there is no guarantee that the results will resemble
the results of perfect competition at all. In other words, economic
systems are subject to a form of chaos such that 100% of the conditions
lead to something optimal, yet 99% of the conditions may lead to
something awful. Catastrophe theory in action.
As the conditions
are never met, there is no economic theory that says that in the real
world there is actually a general case for capitalism. The case for capitalism
must be made on a case-by-case basis, examining the well being of people
before and after they move to and from capitalism to and from other economic
systems.
None of this has stopped the Market Fundamentalists
from carrying on, quite dishonestly, as if economists have provided them
with a sacred text that says that unfettered markets are good for all
of us. They fill the Congress, think tanks, and other places of
influence, pushing for the interests of the few (capitalism does
remarkably well for the 1%) but pushing for them disingenuously in the name of a
political-economic system that they claim, feverishly, is good for
everyone. But the evidence says this is palpably untrue. Some forms of
capitalism in many places have done the poor grave harm; life-and-death harm is exceedingly common.
And it is not just about inequality. It is also
about human survival, as capitalism allows powerful parties who are
grossly enriched by unfettered environmental regulation to destroy our
air and water and biosphere broadly for profit. They do so in the name
of market fundamentalism, literally mocking those who would ask, can we
not do better by collectively acting as if we all matter? If extinction
by environmental devastation is the outcome on the one hand, we must surely consider alternatives to a system that is killing us (and many innocents who have neither say nor profit in our system).
As Naomi Klein says, "this changes everything." Political economic
discourse must admit that capitalism, at least in its current form, may
be lethal. Reasonable people examining alternatives may disagree.
E.g., is Sanders' social democracy, what he calls democratic socialism,
nearly enough? But those who would trot out their market fundamentalism, and deny most of the scientific and other
evidence before our eyes, in order to continue to profit from their
special place in the system, are guilty of negligent homicide -- of entire species, homo sapiens, and many others. This is a hanging offense, but if we
do not stop them, there will be no one left to hang them when we reach
what the Cambridge University Center of Catastrophe Studies considers
the limit beyond which the last 100,000 human beings, living in a stone
age of sorts, can never be expect to bounce back. This tragic end to
humankind may take place in the next century.
When the last woman standing pounds her fist into the earth and curses
the rest of us, it will be far too late to say "I told you so." Can the market fundamentalists be defeated in time? We may have already run out of time, but our only hope is to take action today. A Republican Congress is likely to stand in the way of implementing the Paris Agreement on Climate Change, as it is a very late attempt to turn around environmental destruction. The fate of humankind may well hang in the balance of the Congressional elections of 2016.
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